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On Wednesday, Berenberg analysts adjusted the price target for Hunting Plc (LON:HTG:LN) (OTC: HNTIF), a global energy services provider, to GBP4.80 from the previous GBP4.90. Despite this slight decrease, they have maintained a Buy rating on the company’s shares. The revision followed a trading update from Hunting that indicated strong performance in the first quarter, with all product lines meeting management expectations and margins surpassing previous periods.
Hunting’s trading update revealed that although there was a reduction in cash due to working capital demands, analysts expect this situation to largely improve throughout the year. The balance sheet is anticipated to remain robust, potentially supporting further mergers and acquisitions. Additionally, Hunting’s limited direct exposure to tariffs was highlighted, with the indirect effects of potentially lower commodity prices yet to be fully assessed.
The company has continued to secure new contracts, contributing to a clear outlook on anticipated revenue growth. According to Berenberg’s analysis, Hunting’s valuation is considered reasonable, which supports the firm’s Buy rating on the stock. The analysts underscored the company’s solid financial footing, which they believe will aid in navigating any challenges that may arise from fluctuating commodity prices.
In summary, Hunting has been performing well, with first-quarter results demonstrating strength across all product lines and better-than-expected margins. The decrease in cash due to working capital is seen as a temporary setback, with expectations for a reversal over the year. Hunting’s ability to continue winning new business and its strong balance sheet are key factors in Berenberg’s continued positive outlook on the company’s shares.
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